A new study of global wealth says prosperity peaked around 1978, and we’ve been heading downhill ever since. New Scientist reports.

Governments have tended to build economic policies around gross domestic product (GDP), the sum of all monetary transactions in an economy. GDP has risen fairly steadily -- and often dramatically -- since the second world war, implying the world has become more prosperous. Critics point out, however, that GDP only tells part of the story.

For a more comprehensive measure -- one that accounts for social factors and environmental costs -- economists started using the Genuine Progress Indicator (GPI). It adjusts expenditure in 26 ways to account for costs like pollution, crime and inequality, and for beneficial activities where no money changes hands, such as housework and volunteering.

An international team led by Ida Kubiszewski from Australian National University gathered GPI estimates for 17 countries -- totaling more than half the world's population and GDP -- and assembled them into the first-ever global picture of GPI changes over five decades.

They found that GPI per person peaked in 1978 and has been declining slowly but steadily ever since.

This contrasts sharply with the steady increase in GDP per capita since then, and implies that social and environmental woes have outpaced the growth of monetary wealth.

However, other experts point out how the average person in developing countries is better off now: world poverty rates have fallen and life expectancy has risen. While GPI isn’t a perfect economic welfare indicators, the researchers say it’s a far better estimation than GDP, and could help policy-makers balance the costs and benefits of economic development.